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Strategies & Market Trends : Value Investing -- Ignore unavailable to you. Want to Upgrade?

To: Paul Senior who wrote (27947)	8/30/2007 5:47:49 PM
From: E_K_S	Respond to of 78752

Hi Paul - That's interesting about Seadrill. One of my larger investments SFL (Ship Finance Intl) recently entered into a finance and profit sharring deal with Seadrill for a new $210 million rig. The new rig was to be delivered in July 2007. shipfinance.org According to SFL's press release:"...The rig will be chartered back to the seller for 15 years on a bareboat basis, guaranteed by Seadrill. Seadrill is among the world's leading offshore drilling contractors, with a market capitalization of approximately $6 billion. The aggregate charter payments for the first three years will be approximately $120 million, the following four years will be approximately $77 million, and the last eight years will be approximately $109 million...." Seadrill has a contract w/ ExxonMobil Exploration valued at $82 million where they will use this rig. It's a 400 day term agreement. What's interesting is SFL has a profit sharing arrangement with Seadrill for this rig. It's quite small but I guess I also have a "vested" interest in this investment too. ("...In addition to the fixed charter rate, Ship Finance will receive a profit split element of 4% above certain threshold levels, starting January 1, 2009. During the charter period the charterer will have several options to buy back the rig, and the first purchase option will be after 3 years at $142 million and the last purchase option after 15 years at $60 million...") This was the first large investment for SFL outside their normal oil tanker financing business and is potentially a new and profitable sector for new financing opportunities. SFL was formed in 2003 and spun-off from Frontline Ltd. (FRO) in June 2004. According to this article, SFL is still considered to be undervalued (http://seekingalpha.com/article/22729-ship-finance-international-the-big-boats-are-thriving). EKS

To: Paul Senior who wrote (27947)	3/25/2008 12:39:30 PM
From: E_K_S	Read Replies (2) \| Respond to of 78752

Hi Paul - I thought you might be interested to see that billionaire John Fredriksen, largest shareholder of Frontline) has taken a stake of up to 10% in rival Overseas Shipholding Group (OSG). Frontline has a forward contract for 1,366,600 shares, or a further 4.4%, in OSG. If Frontline decides to take delivery of these shares, the company and Mr Fredriksen would control 9.6% of OSG. According to the article, Frontline and group companies view both these holdings as good financial value investments. aftenposten.no It will be interesting to see what his plans are for integrating this investment into his empire. EKS